[LINK] NBN white-elephant-to-be ...

Birch, Jim Jim.Birch at dhhs.tas.gov.au
Wed Aug 25 13:57:13 AEST 2010

Marghanita da Cruz wrote:

> In any event, the NBN in high density urban areas is a non-issue - the
market meets demand.

Not quite:

(1) The universal service of the NBN means that the cost paid by city
dwellers subsidises country connections.  I have no real idea, but I
guess that the NBN cost would about half if we booted the most expensive
20% of subscribers off the system.  In Australia, we do this kind of
thing with other services like roads, electricity, water, phone, health,
etc, using a variety of mechanisms like taxation, standard charges, etc.
Most people would agree with these practice, to some extent at least.
The NBN provides a fairly robust and isolated mechanism for achieving
this in telecoms.

(2) Apart from providing very fast comms links, another really big key
positive is to eliminate the Telstra copper monopoly.  Clearly something
has to be done about Telstra holding the country to ransom.  Apart from
overpriced basic services, there are significant cost impacts in terms
of failure to innovate technologically when there's no business case for
a monopoly, and in limiting the competition in services in favour of
exclusive partner deals. The new infrastructure would be publically
owned and customers can swap providers at the flick of a software
switch.  I don't see this can be given any kind of dollar figure, but we
can expect these competition benefits to be substantial given the
increasing presence of electronic communication to how we live, work and
play.  The market will provide in high density urban areas but you may
find they are locked into someone's vertical market.

Neither of these points are the primary reason for the NBN, and they
could *theoretically* be achieved in other ways, but they are
significant real world benefits of the NBN.

- Jim


The information in this transmission may be confidential and/or protected by legal professional privilege, and is intended only for the person or persons to whom it is addressed. If you are not such a person, you are warned that any disclosure, copying or dissemination of the information is unauthorised. If you have received the transmission in error, please immediately contact this office by telephone, fax or email, to inform us of the error and to enable arrangements to be made for the destruction of the transmission, or its return at our cost. No liability is accepted for any unauthorised use of the information contained in this transmission. If the transmission contains advice, the advice is based on instructions in relation to, and is provided to the addressee in connection with, the matter mentioned above. Responsibility is not accepted for reliance upon it by any other person or for any other purpose.

More information about the Link mailing list